2018 (7) TMI 1589 – CESTAT KOLKATA – TMI – Benefit of N/N. 1/2011-CE dated 01.03.2011 – availability of CENVAT Credit on inputs and utilization of the same by beneficiary of the notification – demand of Interest and penalty – Held that:- The appellants have complied with all the necessary statutory returns within the stipulated time and the fact of claiming exemption benefit was disclosed in the ER-1 returns filed during the relevant period. It is also not in dispute that the appellants paid the entire duty amount through the CENVAT Account and thereafter, through the current account, thereby, causing no loss of Revenue to the exchequer.
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The mistake seems to be that of procedural and irregularities – the subsequent payment in cash was the only action by which procedural irregularities could be rectified.
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The appellant has made out a case for non-imposition of penalty and also for setting aside the demand of interest – appeal allowed – decided in favor of appellant. – Appea
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tted). Show Cause Notice dated 15.01.2013 was issued alleging that the appellant-assessee while availing benefit of Notification No.1/2011-CE (Supra) made payment of Central Excise duty availing the CENVAT Credit account whereas the same should have been made from Current Account. It is the case of the Revenue that the beneficiaries of the aforesaid notification cannot avail the CENVAT Credit on inputs and utilize the same for payment of Central Excise duty. Show Cause Notice proposed to demand and recover an amount of ₹ 43,38,830/- through the current account alongwith interest and to impose penalty. The adjudicating authority confirmed the demand of ₹ 31,22,159/- and dropped the demand to the tune of ₹ 12,16,671/- and appropriated the amount of ₹ 31,22,159/- as paid by the appellants. Penalty of ₹ 31,22,159/- was also imposed on the appellant under Section 11AC of the Central Excise Act, 1944. On appeal, the Ld. Commissioner (Appeals) upheld the Order-in
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entral Excise duty on clearance of fertilizers under the said Notification the imposition of penalty under Section 11AC is unwarranted. 4. It is the contention of the Ld. Counsel that the statutory returns were filed by the appellants with the Department showing the payment of duty from CENVAT Account and the Department regularized and allowed the benefit of exemption Notification on payment of entire duty amount by cash. The matter being that of interpretation, it cannot be construed that there was suppression with intent to evade payment of duty and having submitted monthly returns showing availment of CENVAT Credit, penalty under Section 11AC is not imposable. Further, the Ld. Counsel argued that Section 3(1) Central Excise Act, 1944 provides that the duty of Excise is to be called as Central Value Added Tax. As there was no non-payment of duty in the present case, payment of interest is not sustained. He relied on the decision of Tribunal in the case of Commissioner of Central Exci
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se Act, it is necessary to prove that there was fraud, collusion, willful misstatement, suppression of facts with intent to evade payment of duty on the part of the appellant. From the perusal of records, I do not find any ingredients of willful misstatement, suppression of facts etc. with intent to evade payment of duty. There is also no suppression or mis-representation in respect of availment of CENVAT Credit. 8. I find that in the present case, the appellant was not retaining any money due to the Government. The subsequent payment in cash was the only action by which procedural irregularities could be rectified. 9. I find that the co-ordinate Bench of the Tribunal in the case of Banco Products (India) Ltd. (Supra) by relying upon the decision of the Tribunal in the case of Commissioner of Central Excise, Vs. Vulcan Gears [2009] 23 STT 472 (Ahd.-CESTAT), rejected the Revenue s appeal before them. By following the view taken by the Tribunal in the case referred to above, I do not con
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